Won't a carbon tax raise my power bills? 12/14/2008

A tax that's good for us all.

I don't want to contribute any more to global warming than I already am, but I can barely afford my winter heating bills. What will happen if we pass a carbon tax or regulate carbon emissions more? Won't my bills go up?

— Taxed in Texas

Dear Taxed,

You couldn't start with something a bit simpler? Folks, it's my first month on the job! Whatever happened to "Can I compost egg shells?"

Yes, your heating bills are likely to go up, but that doesn't necessarily mean you will be spending more. Huh??

To start, we can't survive (yes, I said survive) without quickly enacted limits on carbon emissions. Most likely that will be in the form of cap-and-trade regulations or some version of a carbon tax.

One widely supported scenario has any pollution tax revenue going directly back to the populace and into economic stimulus projects for alternative energy while also, potentially, doing away with income tax. There is a wide consensus — conservative and liberal, economist and ecologist — that shifting to pollution taxes would improve the economy, even if we weren't concerned about global warming.

They think a carbon tax is essential to moving the nation beyond fossil fuels. "The public will support the tax if it is returned to them, equal shares on a per-capita basis) half shares for children up to a maximum of two child shares per family), deposited monthly in bank accounts. No large bureaucracy is needed. A person reducing his carbon footprint more than average makes money. (Read more the letter here.) Obviously, I agree with them, but not on all points.

We are, I hope, about to make a groundbreaking shift toward a sustainable society and a sane, green economy. Van Jones, founder of Green For All and author of "The Green Collar Economy," estimates 8.5 million new green jobs, almost 4970 billion in revenue, and more than $100 billion in industry profits were generated in 2006 alone. It would be unwise to think we won't feel the results of such a shift — of higher energy prices, yes, but also of lower unemployment and lower health-care costs.

A mass revision of how much we consume, and how we consume it, is necessary for real change. That change is unlikely to start without people experiencing the financial burden of waste.

Realistically, prices will have to increase if we are to meet the carbon reductions that Hansen and most other climate scientists warn are essential to prevent catastrophic global instability. We have shaped our lives and economy around the illusion of cheap energy, and that can't last. No one wants to see bills go up, but we're already paying a far greater cost in so many other ways that we can't afford not to pay more for energy.

The good news is — as with most things green — that what is good for the planet tends to be good for us. While we will experience the hardships of such a tremendous shift, the results will benefit us all.

Keep in mind that you can offset rises in energy costs with simple conservation steps. A change in consumption habits will save you money. So put on a sweater and lower the thermostat.

Thanks for the question. It's an important one, and goes to the core of so many of the issues we'll face in the coming years.

Keep the questions coming, and as always, keep it green,

Vanessa

*All fossil fuels contain carbon atoms which release carbon dioxide when they burn. A carbon tax levies a fee on the production, distribution or use of fossil fuels. The tax makes fossil fuels more expensive, which is intended to encourage a reduction in consumption.

*Cap and trade — also known as emissions trading — is a method of controlling pollution by providing an incentive for a reduction in carbon dioxide emissions. The cap, or limit on total emissions, is set by a governing body which distributes or auctions credits that represent pollution waivers. The trade comes into play when one company needs more credits to cover its pollution needs or when it has reduced its emissions and therefore has credits to spare.